This is the Phase 2 application entitled "Discovery and Development of Antidiabetic Drugs." The goal is to identify new molecular entities that promote the IRS2-branch of the insulin/IGF signaling system. The NIH support will be used to identify compounds that promote IRS2 signaling in test cells. Myloid cells will be used as the test cell for high throughput screening; survival of these cells in tissue culture is the assay endpoint. The ability of these compounds to promote pancreatic beta-cell growth, function and survival will be validated in rodent beta-cells lines and rodent islets. Since diabetes is a major chronic disease of epidemic proportions, pharmaceutical products developed at HPRL will have opportunities for clinical testing worldwide. Dysregulated insulin signaling is a complex molecular problem that is associated with various metabolic diseases that progress to diabetes in more than 16 million people in the United States alone. Basic scientific investigation conducted over the past several years reveals that the insulin receptor substrate-2 protein is an essential component of the insulin signaling network in peripheral tissues and pancreatic beta-cells. The identification of new chemical entities that enhance the function of IRS2 might lead to fundamental improvements in the treatment or prevention type 2 diabetes. During Phase 1, we obtained a license from the Joslin Diabetes Center to use patented technology required to accomplish the proposed project. Moreover, we identified a chemical library in excess of 100,000 compounds of high complexity and low toxicity for high throughput screening. Finally, we established a prototype automated high throughput cell- based screen to identify compounds that promote IRS2 signaling. This Phase 2 SBIR application is focused upon 3 Specific Aims: 1. Use the validated HTP 32Dlrs2 cell-based assay to identify compounds that promote IRS2 signaling. 2. Validate the selectivity and specificity of the identified compounds toward the IRS2 signaling cascade. 3. Establish the physiological function of the validated compounds as NME's that promote IRS2 signaling in cell lines derived from transgenic mouse models of type 2 diabetes as well as in cellular metabolic assays in adipocytes. The NME's that emerge from this Phase 2 proposal can provide a new class of compounds that modulate protein-protein interactions upon the IRS2 scaffold. Some of these NME's could display the ability to promote central and peripheral insulin action and pancreatic beta-cell function, which can treat or cure diabetes. Since diabetes is a major chronic disease of epidemic proportions, validated compounds identified by this Phase 2 Award can have a worldwide market potential. [unreadable] [unreadable] [unreadable]